The initiative named the Wool and Mohair Value-chain Competitiveness Project (WaMCoP) has received $72m funding in total and aims to foster inclusive and sustainable economic growth while generating employment opportunities within the private sector.
IFAD has provided $20.2m of funding, the OPEC Fund has provided $20m, GEF has given $6m, the government of Lesotho has contributed $8m, and the project has received $7.3m from the private sector and project beneficiaries.
In Lesotho small-scale farmers are the primary source of wool and mohair fibres, constituting 60% of agricultural exports and supporting more than a quarter of the rural population.
However, challenges such as climate change, unreliable input supply, overstocking, and poor land conditions hinder production. Coordination issues, the absence of a certification system, limited capacity to address market demands, and insufficient access to finances further compound these challenges.
The project will focus on Mokhotlong, Maseru Rural, Quthing, and Thaba Tseka districts to begin with as they are key areas for wool and mohair production with high levels of poverty.
The project will then expand its reach to cover the entire country and will build on the successes of the Wool and Mohair Promotion Project (WAMPP).
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The project will support the establishment of a responsible production certification system aligned with global market guidelines. This certification will introduce traceability to assist buyers in verifying and identifying wool and mohair produced in farming systems, ensuring Lesotho’s global standing and market competitiveness, ultimately contributing to increased incomes for farmers.
The project is anticipated to have a particularly important impact on women who are typically not involved in the sector but constitute 50% of project participants, while youth make up over a third (35%).
IFAD country director for Lesotho Edith Kirumba emphasised the crucial role IFAD has played in the development of Lesotho’s wool and mohair value chain.
She explained that for the country to maintain its global reputation of producing high-quality wool, it is imperative to address the evolving demands of the global market.
She said: “WaMCoP is very timely as it will help the country to continue building the sector, while addressing the new market demands through innovative approaches such as traceability, ethical and responsible production, thus allowing small-scale farmers to participate in the global market system.”
WaMCoP aims to adopt innovative approaches, including collaborating with the Ethical Fashion Initiative, to “re-conceptualise” the cottage industry in Lesotho and establish sustainable market linkages for wool and mohair products. This not only aims to benefit the national fashion industry but also creates a distinct Basotho brand for these fibres.
Additionally, WaMCoP will set up a revolving fund to facilitate access to input supply and in-kind loans for farmers and value chain actors. A Wool and Mohair Fund and Enterprise will be established to bring together all value chain players, ensuring effective governance and the long-term viability of the sector.
Having invested $112.4m in 12 rural development programmes and projects in Lesotho since 1980, IFAD’s contributions are said to have reached almost $322.9m, claiming to benefit 339,720 rural households.
The project also has an open financing envelope of $11.8m available for new and interested financiers.